Futron Study Predicted Big Benefits for New Mexico, Lacked Risk Assessment
Credit: Futron Corporation
Ten years ago, New Mexico released an economic impact study conducted by the Futron Corporation that assessed the potential benefits of Spaceport America and the state’s newly announced partnership with Richard Branson’s Virgin Galactic.
“The suborbital market features a strong increase in launches because of growing demand for space tourism, with the potential number of launches from the New Mexico spaceport increasing from 61 in 2010 to 426 in 2020,” the report states. “Futron estimates that the spaceport has the potential to provide the basis for creating approximately $460 million of additional economic activity in New Mexico, with some 3,460 new jobs in 2015.”
Ten years later, anchor tenant Virgin Galactic has not flow a single suborbital spaceflight with its future schedule unclear. Spaceport America sits largely empty in the desert, having largely used for suborbital sounding rocket launches. The facility has cost New Mexican taxpayers around $225 million, with that amount rising as the facility operates at a loss.
The Futron study looked at maximum possible benefits in terms of spaceflights and economic impact based on assumptions and data provided by New Mexico. Futron did not look at the risks associated with the venture, including delays in construction or with the technology and companies involved.
I’ve reproduced the executive summary below.
New Mexico Commercial Spaceport
Economic Impact Study
for State of New Mexico Economic Development Department
December 30, 2005
EXECUTIVE SUMMARY
The commercial space industry in the United States is undergoing a major transformation, with the emergence of new markets and new companies to serve those markets. Suborbital space tourism companies have attracted the interest of thousands of prospective customers, while several tourists have already flown on orbital missions to the International Space Station (ISS). A number of companies are developing small, inexpensive launch vehicles designed to serve commercial and government customers and to launch payloads on short notice. NASA is also fostering the development of a revitalized commercial space industry by offering to help companies develop spacecraft that can transport cargo and crews to and from the ISS.
While there are several spaceports in the United States today, these are primarily older facilities designed to serve large, expensive, expendable launch vehicles, and are ill-suited for the new generation of small, responsive suborbital and orbital vehicles. This situation presents an opportunity for states to develop new spaceports that are more agile and less expensive than the legacy facilities.
The Futron Corporation, under a contract from the State of New Mexico Economic Development Department, has studied the potential economic impact of one such proposed spaceport in southern New Mexico, the Southwest Regional Spaceport. This report provides a forecast for potential spaceport activity and resulting economic impact for the years 2010 through 2020, based on the spaceport beginning operations in 2009. The results of this analysis should be considered forward-looking estimates of the maximum possible economic impact of the spaceport should the spaceport and related industries be developed and utilized to their full potential.
In the first part of this study, Futron developed a forecast of the potential number of launches that could be hosted by the spaceport between 2010 and 2020, as summarized in Figure 1 below. The launch market is divided into three specific classes: suborbital launches, small orbital launches, and large orbital launches. The suborbital market features a strong increase in launches because of growing demand for space tourism, with the potential number of launches from the New Mexico spaceport increasing from 61 in 2010 to 426 in 2020. Orbital space tourism and commercial resupply missions to the ISS may generate up to three launches per year of large orbital vehicles between 2010 and 2020, and there will be no more than one launch a year of small orbital vehicles during the forecast period due to range limitations for small expendable launch vehicles at the spaceport.
Based on this launch market forecast, Futron developed a forward-looking assessment of the economic impact of the spaceport in 2015 and 2020 based on Governor Bill Richardson’s vision for creating a new commercial space transportation and manufacturing cluster in southern New Mexico, along with key assumptions provided by the New Mexico state government. In summary, Futron estimates that the spaceport has the potential to provide the basis for creating approximately $460 million of additional economic activity in New Mexico, with some 3,460 new jobs in 2015. These figures could increase to about $550 million of additional economic activity and 4,320 new jobs in 2020 (see Figure 2). These projections include the following major categories of economic activities: space transportation, visitor spending and tourism, and Rocket Racing League operations. All economic impact figures and assumptions presented throughout the study are in current 2005 dollars.
Futron projects that southern New Mexico has the further potential to attract an additional 1,000 to 1,500 jobs in space vehicle and aircraft manufacturing, headquarters operations and support services activities and in excess of $200 million in related economic activity by 2020. These estimates are strongly dependent on the ability of the State of New Mexico and early commercial space transportation operators to attract manufacturers of reusable launch vehicles and aircraft, along with their key suppliers, to locate manufacturing facilities in close proximity to customer firms operating out of the spaceport. The analysis is also based on the assumption by the State of New Mexico that one specific major commercial space transportation and manufacturing firm wins a pending NASA award for Space Station cargo and crew re-supply services, and subsequently locates its core operations facilities in New Mexico, along with the assumption that emerging public and federal markets for commercial space transportation services will develop without major interruption for the foreseeable future.
Spaceport construction-related impacts are anticipated to occur prior to the period under consideration in this study. Such impacts will be restricted to the years 2006-2008, and are expected to reach a maximum of approximately $331 million of additional economic activity and 2,460 new jobs in 2007. Additional economic impacts from new hotel and other tourism infrastructure construction are not included in this estimate.
The majority of the economic impact from the spaceport will be concentrated in the vicinity of Las Cruces, with secondary impacts anticipated for Albuquerque and tourism-centric localities elsewhere in the state. The economic impact of this new spaceport is potentially quite large, reflecting the strong upscale potential of the nascent space tourism industry. If successful, the spaceport can serve as the magnet for an emerging commercial space transportation cluster, which leverages economies of scale in spaceport operations and close operator-manufacturer-supplier relationships to attract new launch firms and RLV and aircraft producers to co-locate facilities in southern New Mexico.
9 responses to “Futron Study Predicted Big Benefits for New Mexico, Lacked Risk Assessment”
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Avascent acquired the satellite, space, and telecommunications
businesses of Futron Corporation in 2014.
http://www.avascent.com/201…
Literature luring people into the undeveloped American West was full of flat out lies, exaggerations, and theories pumped by optimism, showmanship, and greed. Ideas such as, the dust raised by plowing the great plains would seed the clouds and make it rain. Or ignoring the failure rate of pioneer family farms and the resultant poverty rate. Now then again, poverty in the wild west is not the poverty we know today. Folks did not starve, and could bootstrap themselves out of failure quickly. Honest hard work was rewarded almost as often as dis-honest work. That said, it all worked out great. In the end, after decades, reality eventually came to exceed the yarns spun by the worst hucksters.
By the 1920’s aviation was filled with a more more constrained yet similar version. By the 20’s you’ll see promises of returns on aviation that were not met until the 1990’s. The promises made back then for trans oceanic and continental travel are all met. As were the promises for warfare. It’s interesting to note, that military aviation required the advent of space systems to encode the globe to allow military aviation to meet the promises set out by characters like Billy Mitchell. However, it took 70 years and the development of two new power cycles (rocket and air breathing jet), and the advent of electronics for that to happen.
Space will be much the same. However the return on the promises of the hucksters will take much longer provided we don’t make a propulsion breakthrough. Perhaps just as the American West required the advent of the locomotive, and aviation required the advent of jet propulsion and electronics, space may be awaiting a new propulsion technology, or perhaps it’s a materials breakthrough, or both to push it over the top. That said it’ll be a while before space stops being a enterprise where you have to face all the risk now, with the payoff somewhere yet in the future.
Just as the global village foreseen in the 60’s and 70’s is starting to come true with some real bite. I think the other visions will also come true. It’s just going to take a lot longer than we all think/wish. Until then, we’ll have preachers like The Space Frontier Foundation, and liers and damn statisticians from Futron to cheer us on and into the breach.
“Until comes Steam-engine time”!
I’m looking forward to the orbital launches from Spaceport America.
Orbital launch was always part of the business model for the Southwest Regional Spaceport (Spaceport America) starting with the planned DC-1. That is why safe orbital launch corridors were mapped out for it based on decades of safe (zero injuries) overland off range rocket launches that WSMR conducted since the late 1950’s. Below is a youtube discussing such flights in the 1960’s.
https://www.youtube.com/wat…
I understand the most recent flight was in 2014.
Clearly, orbital flights were part of the Spaceport America plan as the report above has forecasts for a few such flights each year. I wonder how they came up with the forecast? Just wishful guessing I think unless some company is on record as expressing an interest for doing that.
Personally, I would much rather have desert areas like Spaceport America be used for spaceflight rather than nice coastal property, so I hope this orbital flight dream comes true.
I recall some talk about getting Orbital to launch the Pegasus out of NM about that time frame. BTW, the overland flights are continuing. Although not covered by national media, they are too routine, they had another one last week.
http://www.morningstar.com/…
“Orbital ATK (NYSE: OA), a global leader in aerospace and defense technologies, successfully launched a Patriot Target Vehicle (PTV) for the U.S. Air Force Space and Missile Systems Center (SMC). Orbital ATK’s PTV served as an intercept target for the U.S. Army Lower Tier Project Office (LTPO) Patriot missile defense system. The PTV was launched on December 10, 2015 from Fort Wingate into the White Sands Missile Range (WSMR) in New Mexico. It flew a southerly trajectory over WSMR and was intercepted by the Patriot Advance Capability-3(PAC-3) Missile Segment Enhancement (MSE) interceptor system during reentry.”
Fort Wingate is near Gallup, close to the Arizona border by I-40. Really, given the procedures in place, and safety record, it amazes me that SpaceX is fooling around with South Texas when NM is a cheaper and safer alternative. It shows how traditional thinking impacts even those who are innovative.
Doug,
Great thread!
Actually there is a back story. Before the Futron Study the Arrowhead Center at the School of Business at New Mexico State University did a study of the economic impact in early 2005. It is still online here.
http://arrowheadcenter.nmsu…
It was one of many done for the state.
http://arrowheadcenter.nmsu…
The report indicated only a handful of flight through 2010 based on the FAA AST suborbital launch outlook and needless to say a much smaller economic impact. The report also suggested a staged strategy focusing on unmanned (freight) flights, then tourists flight and only developing infrastructure as needed.
Friends I know at the school of business indicated the folks in Santa Fe were not happy with it as they felt that they didn’t “understand” New Space. That is why they decided to hire a “professional” consulting firm that “got” New Space. Hence the Futron Study. It is interesting comparing the forecasts, assumptions and recommendations of the two studies done in the same year.
Wow! A SWOT analysis. No wonder Richardson & Co. hated this study. Actually leveling with the populous about the risks? Can’t have that.